Section 2: See the trees but missed the wo

Every one trained in the Value Stream Mapping (abbreviation, VSM) methodology is mesmerized by the helicopter view of the entire operation flow in study. An analysis of the statistics gathered during the process of building the VSM Figure usually surfaces several significant level of improvement opportunities. Throw in another exercise to identify the undesirable objects. More opportunities for improvements will be surfaced.

This is a typical example of the end-result of a 4-day VSM workshop. See Figure S2-1 and S2-2 below.

Figure S2-1: Results of a 4-day VSM workshop

The VSM methodology is the wonder tool for all lean experts and lean masters alike to zoom in on reducing the lead time. On the surface it can’t go wrong. The 57.25% improvement in cycle time is impressive. But in the author’s opinion, it should be in the range of three digits and not two digits in percentage of improvements.

Figure S2-2: List of undesirable objects gathered during the workshop

The list of undesirable objects identified was 36 items. Does the project leader have to complete resolving all the 36 items? Does he have to carry out a Pareto analysis to prioritize his actions plans? Did the project leader ask whether this list of 36 items if executed will bring about quantum leaps in the operation’s performance?

What the lean master told him was, “You must carry out solution to resolve all the 36 items. That is the most important step of the VSM exercise.”

Please refer to Figure S2-2. Other than the reduction in the lead time, distance traveled and non-value-added percentages, these three performance indicator do not reflect the core performance indicator of a typical operations. They are: increase in productivity or reduce labor cost, improve in quality or reduce in yield loss, improve in on-time delivery, increase production capacity or equipment utilization level.

Like-wise, most of the undesirable objects could not be directly linked to improvement in the core performance indicators mentioned in the above paragraph.

Why didn’t the management ask for substantial output from the VSM exercise other than those listed in Figure S2-1 and S2-2? The answer is straight-forward. Everybody knows that the use of a simple VSM tool is not going to deliver the desired results.

Did anyone in the workshop ask the lean master these two questions?

One, “Does the VSM tool build upon the fundamental philosophy of the Toyota Production System?”

Two, “Does the VSM tool build upon the just-in-time philosophy namely; right part, right time and right quantity?”

Obviously no one asked.

Neither do they know that the VSM tool is not a technique taught in the Toyota Production system. It is an American developed tool. A tool developed without the philosophy behind the Toyota Production System. I am afraid even the lean master does not know about this fact.

If you beg to differ in your opinion, you should look closely at the definition of right quantity for each of the bucket or workstation in you VSM flow chart when you next carry out a VSM exercise. To be more exacting, you should look into how to ensure that the right part arrives at each workstation at the right time and in the right quantity.

This section describes to you, the danger of blind faith in the statistics gathered for the VSM project. The statistical average, percentage, takt time and Pareto analysis often are misused to the detriment of the company.

Most lean production workshop is designed around the Value Stream Mapping (abbreviation, VSM) process. As the saying goes, “we must make decision based on facts.” However, few people realized that statistics don’t lie; but it can be misused.

We all agree statistics is factual data. Assuming the statistics derived were not fudged at all. They are honestly correct. But that does not mean the decisions that are going to be made based on these strong facts are correct. They can be fatally wrong. This is the reason behind why the author wrote this section.

The VSM process is built on the principles of the lean production system which is an aggregate of many lean production techniques borrowed from the Toyota Production system. For more than 50 years and many hundreds thousands of employees in Toyota Motor Corporation had refined these lean production techniques.

However, these lean production techniques were easy to learn but difficult to apply well. The most difficult of which is the ‘Just-in-time’ philosophy that forms the core fundamental foundation of the Toyota Production system. Just-in-time means right product, right time and at the right quantity.

However, when Professor Daniel T. Jones coined the phrase, ‘lean production system’, lean is interpreted to be quite flexible and it is totally up to the user to define what the right quantity is.

On this note, the VSM process too, allows the users to broadly define what the right quantity is. Not necessary, the barest minimum level of inventory or Work-in-progress quantity at any work station or process.

Perhaps, you may argue that there is nothing wrong with providing this extra bandwidth or flexible in defining the right quantity. But if you are not careful in the determination of the correct use of the unit of measurement, the effect of the VSM exercise can turn out to be a complete waste of time. It is not going to bring in any significant result.

In the following few chapters, the author is sharing with you how things can go utterly wrong when the statistics; average, percentage, takt time, leveled customer demand and the Pareto analysis. These are the most loved, commonly and most wide-spread used statistics.